Air Products May Sell Engineering-services Unit Proposed Sale One Of 'Various Options'

May 07, 1986|The Morning Call

Air Products & Chemicals Inc. has notified the 1,000 employees at its engineering-services subsidiary in Philadelphia that the division might be sold.

In a letter, Dexter F. Baker, president of Air Products, told the employees of Stearns-Catalytic World Corp. last week that the company was reviewing "various options."

"Although no decision has been reached," he wrote, the managers of Air Products and Stearns "have agreed to examine among the various options the possible sale of Stearns-Catalytic to another group that could be better positioned to take advantage of its current and long-term potential."

Air Products, of Trexlertown, manufacturer of industrial gases, formed Stearns-Catalytic in 1984 by consolidating two subsidiaries, Catalytic Inc. of Philadelphia and Stearns-Roger Inc. of Denver. Since the consolidation, sales, profits and construction backlog for Stearns-Catalytic have declined. The division provides plant construction and maintenance services to petroleum, electric-power, chemical, electronics, pharmaceutical and mining industries.

"The engineering construction business has been on the decline for the past couple of years," according to Amy Coffern, a spokeswoman for Stearns- Catalytic in Denver, where the company employs an additional 2,000 people who also received Baker's letter. "A lot of our markets are very flat right now," she said. In light of the deep cutbacks in the oil industry, "many major projects are on hold."

Kevin J. Ramundo, a spokesman for Air Products, said that sale of the subsidiary "is just one of many possible options." He said that a possible sale was acknowledged explicitly in Baker's letter only in response to a rumor among employees.

Company officials declined to discuss the other options under considerations or their reasons for the re-examination. "Discussion would be premature while we're evaluating it," Ramundo said.

Air Products earned $273 million on sales of $1.83 billion for the company's most recent fiscal year which ended Sept. 30. Stearns-Catalytic earned $5 million on sales of $65 million for the period.